CV Therapeutics, Inc.
(a Delaware corporation)
$175,000,000
4 3/4% Convertible Subordinated Notes due 2007
PURCHASE AGREEMENT
March 1, 2000
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
X.X. Xxxxxx Securities Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx Inc.
XX Xxxxx Securities Corporation
as Representative(s) of the several Initial Purchasers
c/x Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
CV Therapeutics, Inc., a Delaware corporation (the
"Company"), confirms its agreement with Xxxxxxx Xxxxx & Co.,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx") and each of the other initial purchasers named in
Schedule A hereto (collectively, the "Initial Purchasers,"
which term shall also include any initial purchaser
substituted as hereinafter provided in Section 11 hereof),
for which Xxxxxxx Xxxxx and X.X. Xxxxxx Securities Inc.,
FleetBoston Xxxxxxxxx Xxxxxxxx Inc. and XX Xxxxx Securities
Corporation are acting as representatives (in such capacity,
the "Representatives"), with respect to the issue and sale
by the Company and the purchase by the Initial Purchasers,
acting severally and not jointly, of the respective
principal amounts set forth in said Schedule A of
$175,000,000 aggregate principal amount of the Company's 4_%
Convertible Subordinated Notes due 2007 (the "Notes"), and
with respect to the grant by the Company to the Initial
Purchasers of the option described in Section 2(b) hereof to
purchase all or any part of an additional $26,250,000
aggregate principal amount of Notes to cover over-
allotments, if any. The aforesaid $175,000,000 aggregate
principal amount of Notes (the "Initial Securities") to be
purchased by the Initial Purchasers and all or any part of
the $26,250,000 aggregate principal amount of
Notes subject to the option described in Section 2(b) hereof (the
"Option Securities") are hereinafter called, collectively, the
"Securities." The Securities are to be issued pursuant to
an indenture to be dated as of March 7, 2000 (the
"Indenture") between the Company and Norwest Bank,
Minnesota, N.A., as trustee (the "Trustee"). Securities
issued in book-entry form will be issued to Cede & Co. as
nominee of The Depository Trust Company ("DTC") pursuant to
a letter agreement, to be dated as of the Closing Time (as
defined in Section 2(c)) (the "DTC Agreement"), among the
Company, the Trustee and DTC.
The Securities are convertible at the option of the
holder at any time on or prior to maturity, unless
previously redeemed or otherwise purchased, into shares of
the Company's Common Stock, par value $.001 per share (the
"Common Stock"), at the initial conversion price specified
in Schedule A hereto.
The Company understands that the Initial Purchasers
propose to make an offering of the Securities on the terms
and in the manner set forth herein and agrees that the
Initial Purchasers may resell, subject to the conditions set
forth herein, all or a portion of the Securities to
purchasers ("Subsequent Purchasers") at any time after this
Agreement has been executed and delivered. The Securities
are to be offered and sold through the Initial Purchasers
without being registered under the Securities Act of 1933,
as amended (the "1933 Act"), in reliance upon exemptions
therefrom. Pursuant to the terms of the Securities and the
Indenture, investors that acquire Securities may only resell
or otherwise transfer such Securities if such Securities are
hereafter registered under the 1933 Act or if an exemption
from the registration requirements of the 1933 Act is
available (including the exemption afforded by Rule 144A
("Rule 144A") of the rules and regulations promulgated under
the 1933 Act by the Securities and Exchange Commission (the
"Commission")). Prior to the purchase of the Securities by
the Initial Purchasers, the Company will enter into with the
Initial Purchasers an agreement (the "Registration Rights
Agreement") pursuant to which the Company is required to
file and use its reasonable best efforts to have declared
effective a registration statement under the 1933 Act to
register resales of the Securities and the shares of Common
Stock issuable upon conversion thereof.
The Company has prepared and delivered to the Initial
Purchasers copies of a preliminary offering memorandum dated
February 25, 2000 (the "Preliminary Offering Memorandum")
and has prepared and will deliver to the Initial Purchasers,
on the date hereof or the next succeeding day, copies of a
final offering memorandum dated March 1, 2000 (the "Final
Offering Memorandum"), each for use by the Initial
Purchasers in connection with its solicitation of purchases
of, or offering of, the Securities. "Offering Memorandum"
means, with respect to any date or time referred to in this
Agreement, the most recent offering memorandum (whether the
Preliminary Offering Memorandum or the Final Offering
Memorandum, or any amendment or supplement to either such
document), which has been prepared and delivered by the
Company to the Initial Purchasers in connection with their
solicitation of purchases of, or offering of, the
Securities.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties. The Company
represents and warrants to each Initial Purchaser as of the
date hereof, as of the Closing Time referred to in
Section 2(c) hereof and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each
Initial Purchaser, as follows:
(i) Offering Memorandum. The Offering Memorandum does
not, and at the Closing Time (and, if any Option Securities
are purchased, at each Date of Delivery) will not, include
an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; provided that this
representation, warranty and agreement shall not apply to
statements in or omissions from the Offering Memorandum made
in reliance upon and in conformity with information
furnished to the Company in writing by any Initial Purchaser
expressly for use in the Offering Memorandum.
(ii) Documents Filed Pursuant to the 1934 Act. Each of
the Company's (a) Form 10-K, for the fiscal year ended
December 31, 1998; (b) 1999 Proxy Statement Pursuant to
Section 14(a) of the Securities Exchange Act of 1934 (the
"1934 Act"); (c) Forms 10-Q, for the fiscal quarters ended
March 31, 1999 and September 30, 1999; (d) Form 10-Q, for
the fiscal quarter ended June 30, 1999, as amended by Form
10-Q/A dated October 4, 1999; (e) Forms 8-K, dated February
2, 1999, May 5, 1999 and February 25, 2000; and (f) the
description of the Company's Common Stock contained in the
Company's registration statement on Form 8-A, dated October
30, 1996 (collectively, the documents listed in (a) through
(f) above are referred as the "1934 Act Reports"), filed
with the Commission pursuant to the 1934 Act at the time
they were filed with the Commission complied or will comply
in all material respects with the requirements of the 1934
Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), and, when filed
with the Commission (or, if amended, when amended), did not
or will not include an untrue statement of a material fact
or omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading.
(iii) Independent Accountants. The accountants who
certified the financial statements and supporting schedules
included in the Offering Memorandum are
independent public accountants with respect to the Company and its
subsidiary within the meaning of Regulation S-X under the 1933 Act.
(iv) Financial Statements. The financial statements,
together with the related schedules and notes, included in
the Offering Memorandum present fairly the financial
position of the Company and its consolidated subsidiary at
the dates indicated and the statement of operations,
stockholders' equity and cash flows of the Company and its
consolidated subsidiary for the periods specified; said
financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on
a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Offering
Memorandum present fairly in accordance with GAAP the
information required to be stated therein. The selected
financial data and the summary financial information
included in the Offering Memorandum present fairly the
information shown therein and have been compiled on a basis
consistent with that of the audited financial statements
included in the Offering Memorandum.
(v) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the
Offering Memorandum (exclusive of any amendments thereto
after the date hereof), except as otherwise stated therein,
(A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and
its subsidiary considered as one enterprise, whether or not
arising in the ordinary course of business (a "Material
Adverse Effect"), (B) there have been no transactions
entered into by the Company or its subsidiary, other than
those in the ordinary course of business, which are material
with respect to the Company and its subsidiary considered as
one enterprise and (C) there has been no dividend or
distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vi) Good Standing of the Company. The Company has been
duly organized and is validly existing as a corporation in
good standing under the laws of the State of Delaware and
has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in
the Offering Memorandum and to enter into and perform its
obligations under this Agreement, the Registration Rights
Agreement, the Indenture and the Securities; and the Company
is duly qualified as a foreign corporation to transact
business and is in good standing in each other jurisdiction
in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in
good standing could not reasonably be expected to result in
a Material Adverse Effect.
(vii) Good Standing of CVT Adenosine Company. The
Company does not own, directly or indirectly, any interest
in any other corporation, association or other business
entity other than CVT Adenosine Company, a Cayman Islands
corporation ("CVTA"). CVTA has been duly organized and is
validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has the
corporate power and authority to own, lease and operate its
properties and to conduct its business and is duly qualified
as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the
failure so to qualify or to be in good standing could not
reasonably be expected to result in a Material Adverse
Effect; all of the issued and outstanding capital stock of
CVTA has been duly authorized and validly issued, is fully
paid and non-assessable and is owned by the Company,
directly or through its subsidiary, free and clear of any
security interest, mortgage, pledge, lien, encumbrance,
claim or equity; none of the outstanding shares of capital
stock of CVTA was issued in violation of any preemptive or
similar rights of any securityholder of CVTA.
(viii) Capitalization. The authorized, issued and
outstanding capital stock of the Company (a) as of September
30, 1999, was as set forth in the Offering Memorandum in the
column entitled "Actual" under the caption "Capitalization",
(b) was, as of such date, after giving effect to receipt by
the Company of the net proceeds from its public offering of
Common Stock in October 1999, as set forth in the Offering
Memorandum in the column entitled "Pro Forma" under the
caption "Capitalization" (except for subsequent issuances,
if any, pursuant to this Agreement, pursuant to
reservations, agreements or employee benefit plans referred
to in the Offering Memorandum or pursuant to the exercise of
convertible securities, options or warrants referred to in
the Offering Memorandum, and (c) after giving effect to the
transactions contemplated by this Agreement, would have been
as set forth in the Offering Memorandum in the column
entitled "Pro Forma as Adjusted" under the caption
"Capitalization" (except for subsequent issuances, if any,
pursuant to this Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the
Offering Memorandum or pursuant to the exercise of
convertible securities, options or warrants referred to in
the Offering Memorandum. The shares of issued and
outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-
assessable; none of the outstanding shares of capital stock
of the Company was issued in violation of the preemptive or
other similar rights of any securityholder of the Company.
The shares of issued and outstanding capital stock of the
Company have been issued in compliance, in all material
respects, with all federal and state securities laws.
Except as stated in the Offering
Memorandum (exclusive of any amendments thereto after the date
hereof), there are no outstanding options, warrants or other rights
calling for the issuance of, and no commitments, or arrangements to
issue, any shares of capital stock of the Company or any
security convertible into or exchangeable for capital stock
of the Company.
(ix) Authorization of Agreements. This Agreement has
been duly authorized, executed and delivered by the Company.
The Registration Rights Agreement has been duly authorized
and, at the Closing Time, will have been duly executed and
delivered by the Company and will constitute a valid and
legally binding obligation of the Company, enforceable
against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law).
(x) Authorization of the Indenture. The Indenture has
been duly authorized by the Company and, when executed and
delivered by the Company and the Trustee, will constitute a
valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law). The Indenture conforms in all material respects with
the Trust Indenture Act of 1939, as amended (the "1939
Act").
(xi) Authorization of the Securities. The Securities
have been duly authorized and, at the Closing Time, will
have been duly executed by the Company and, when
authenticated, issued and delivered in the manner provided
for in the Indenture and delivered against payment of the
purchase price therefor as provided in this Agreement, will
constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement
thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a
proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits of, the
Indenture.
(xii) Description of the Securities and the Indenture.
The Securities and the Indenture will conform in all
material respects to the respective statements relating
thereto contained in the Offering Memorandum and will be in
substantially the respective forms of the drafts thereof
dated February 29, 2000, with such changes thereto as may be
consented to by the Initial Purchasers, such consent not to
be unreasonably withheld.
(xiii) Authorization and Description of Common Stock. The
Common Stock conforms in all material respects to the
statements relating thereto contained in the Offering
Memorandum and such description conforms in all material
respects to the rights set forth in the instruments defining
the same. Upon issuance and delivery of the Securities in
accordance with this Agreement and the Indenture, the
Securities will be convertible at the option of the holder
thereof for shares of Common Stock in accordance with the
terms of the Securities and the Indenture; the shares of
Common Stock issuable upon conversion of the Securities have
been duly authorized and reserved for issuance upon such
conversion by all necessary corporate action and such
shares, when issued upon such conversion, will be validly
issued and will be fully paid and non-assessable; no holder
of such shares will be subject to personal liability by
reason of being such a holder; and the issuance of such
shares upon such conversion will not be subject to the pre
emptive or other similar rights of any securityholder of the
Company.
(xiv) Absence of Defaults and Conflicts. Neither the
Company nor its subsidiary is (a) in violation of its
charter or by-laws, (b) in default in the performance or
observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or
other agreement or instrument to which the Company or its
subsidiary is a party or by which it or any of them may be
bound, or to which any of the property or assets of the
Company or its subsidiary is subject (collectively,
"Agreements and Instruments") or (c) in violation of any
applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality
or court, domestic or foreign, having jurisdiction over the
Company or its subsidiary or any of their assets, properties
or operations, except for such defaults or violations in the
case of clauses (b) and (c) that could not result in a
Material Adverse Effect. The execution, delivery and
performance of this Agreement, the Registration Rights
Agreement, the Indenture and the Securities and any other
agreement or instrument entered into or issued or to be
entered into or issued by the Company in connection with the
transactions contemplated hereby or thereby or in the
Offering Memorandum and the consummation of the transactions
contemplated herein and in the Offering Memorandum
(including the issuance and sale of the Securities and the
use of the proceeds from the sale of the Securities as
described in the Offering Memorandum under the caption "Use
of Proceeds" and the issuance of the shares of Common Stock
issuable upon conversion of the Securities) and compliance
by the Company with its obligations hereunder and under the
Registration Rights Agreement, the Indenture and the
Securities have been duly authorized by all necessary
corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or a
Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or its subsidiary
pursuant to, the Agreements and Instruments except for such
conflicts, breaches or defaults or liens, charges or
encumbrances that, singly and in the aggregate, could not
reasonably be expected to result in a Material Adverse
Effect, nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or its
subsidiary or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or its subsidiary or
any of their assets, properties or operations. As used
herein, a "Repayment Event" means any event or condition
which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such
indebtedness by the Company or its subsidiary.
(xv) Absence of Labor Dispute. No labor dispute with
the employees of the Company or its subsidiary exists or, to
the knowledge of the Company, is imminent, and the Company
is not aware of any existing or imminent labor disturbance
by the employees of any of its or its subsidiary's principal
suppliers, manufacturers, customers or contractors, which,
in either case, could result in a Material Adverse Effect.
(xvi) Absence of Proceedings. Except as disclosed in the
Offering Memorandum (exclusive of any amendments thereto
after the date hereof), there is no action, suit,
proceeding, inquiry or investigation before or brought by
any court or governmental agency or body, domestic or
foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or its
subsidiary which could reasonably be expected to result in a
Material Adverse Effect, or which could materially and
adversely affect the properties or assets of the Company or
its subsidiary or the consummation of the transactions
contemplated by this Agreement and the Registration Rights
Agreement or the
performance by the Company of its obligations hereunder or thereunder.
The aggregate of all pending legal or governmental proceedings to
which the Company or its subsidiary is a party or of which any of
their respective property or assets is the subject which are
not described in the Offering Memorandum (exclusive of any
amendments thereto after the date hereof), including
ordinary routine litigation incidental to the business,
could not reasonably be expected to result in a Material
Adverse Effect.
(xvii) Possession of Intellectual Property. The Company
and its subsidiary own or possess adequate patents, patent
rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade
names or other intellectual property, including, without
limitation, all of the intellectual property described in
the Offering Memorandum as being owned or licensed by the
Company (collectively, "Intellectual Property"), necessary
to carry on the business now operated by them. Except as
set forth in the Offering Memorandum (exclusive of any
amendments thereto after the date hereof), no valid U.S.
patent is, or to the knowledge of the Company would be,
infringed by the activities of the Company in the
manufacture, use, offer for sale or sale of any product or
component thereof as described in the Offering Memorandum.
The patent applications (the "Patent Applications") filed by
or on behalf of the Company described in the Offering
Memorandum have been properly prepared and filed on behalf
of the Company; except as set forth in the Offering
Memorandum (exclusive of any amendments thereto after the
date hereof) each of the Patent Applications and patents
(the "Patents") described in the Offering Memorandum is
assigned or licensed to the Company, and, except as set
forth in the Offering Memorandum (exclusive of any
amendments thereto after the date hereof), no other entity
or individual has any right or claim in any Patent, Patent
Application or any patent to be issued therefrom; and, to
the knowledge of the Company, each of the Patent
Applications discloses potentially patentable subject
matter. There are no actions, suits or judicial proceedings
pending relating to patents or proprietary information to
which the Company is a party or of which any property of the
Company is subject and neither the Company nor its
subsidiary has received any notice or is otherwise aware of
any infringement of or conflict with asserted rights of
others with respect to any Intellectual Property or of any
facts or circumstances which could render any Intellectual
Property invalid or inadequate to protect the interest of
the Company or its subsidiary therein, and which
infringement or conflict (if the subject of any unfavorable
decision, ruling or finding) or invalidity or inadequacy,
singly or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.
(xviii) Clinical Trials. The human clinical trials
conducted by the Company or in which the Company has
participated relating to ranolazine and CVT-510 that are
described in the Offering Memorandum, or the results of
which are referred to in the Offering Memorandum are the
only human clinical trials currently being conducted by or
on behalf of the Company, and, to the best of the Company's
knowledge, such studies and tests were and, if still
pending, are being, conducted in accordance with
experimental protocols, procedures and controls pursuant to
accepted professional scientific standards; the descriptions
of the results of such studies, tests and trials contained
in the Offering Memorandum are accurate and complete in all
material respects. The Company has no knowledge of any
other studies or tests, the results of which call into
question the results of the clinical trials described in the
Offering Memorandum. The Company has not received any
notices or correspondence from the FDA or any other
governmental agency requiring the termination, suspension or
modification of any clinical trials conducted by, or on
behalf of, the Company or in which the Company has
participated that are described in the Offering Memorandum
or the results of which are referred to in the Offering
Memorandum. All human clinical trials previously conducted
by or on behalf of the Company while conducted by or on
behalf of the Company, were conducted in accordance with
experimental protocols, procedures and controls pursuant to
accepted professional scientific standards; the descriptions
of the results of such studies, tests and trials contained
in the Offering Memorandum, if any, are accurate and
complete in all material respects.
(xix) Absence of Further Requirements. No filing with,
or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or
governmental authority or agency is necessary or required
for the performance by the Company of its obligations
hereunder or under the Registration Rights Agreement or the
Indenture, in connection with the offering, issuance or sale
of the Securities under this Agreement, the issuance of
shares of Common Stock upon conversion of Securities or the
consummation of the transactions contemplated by this
Agreement, the Registration Rights Agreement or the
Indenture, except (a) such as may be required under the 1933
Act or the 1933 Act Regulations in connection with the
transactions contemplated by the Registration Rights
Agreement or (b) or as may be required under the state
securities or blue sky laws.
(xx) Possession of Licenses and Permits. The Company
and its subsidiary possess such permits, licenses,
approvals, consents and other authorizations (including,
licenses, pharmacy licenses, accreditation and other
similar documentation or approvals of any local health
departments) (collectively, "Governmental Licenses") issued
by the appropriate federal, state, local or
foreign regulatory agencies or bodies, including, without
limitation, the Food and Drug Administration ("FDA"),
necessary to conduct the business now operated by them; the
Company and its subsidiary are in compliance with the terms
and conditions of all such Governmental Licenses and all
applicable FDA rules and regulations, guidelines and
policies, except where the failure so to comply could not
reasonably be expected to, singly and in the aggregate,
result in a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, except
where the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force
and effect could not reasonably be expected to result in a
Material Adverse Effect; and neither the Company nor its
subsidiary has received any notice of proceedings relating
to the revocation or modification of any such Governmental
Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, could
reasonably be expected to result in a Material Adverse
Effect.
(xxi) Title to Property. Neither the Company nor its
subsidiary owns any real property. The Company and its
subsidiary have good title to all other properties owned by
them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except such as (a) are described in
the Offering Memorandum or (b) do not, singly and in the
aggregate, materially affect the value of such property and
do not interfere with the use made and proposed to be made
of such property by the Company or its subsidiary; and all
of the leases and subleases material to the business of the
Company and its subsidiary, considered as one enterprise,
and under which the Company or its subsidiary holds
properties described in the Offering Memorandum, are in full
force and effect, and neither the Company nor its subsidiary
has any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Company
or its subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of
such the Company or its subsidiary to the continued
possession of the leased or subleased premises under any
such lease or sublease.
(xxii) Accuracy of Contract Descriptions. All of the
descriptions of contracts or other documents contained in
the Offering Memorandum (exclusive of any amendments thereto
after the date hereof) are accurate and complete
descriptions of such contracts or other documents. There
are no contracts or documents which are required to be
described in the 1934 Act Reports or to be filed as exhibits
thereto which have not been so described therein and filed
as required. There are no contracts or other documents
which would be required to be described in the Offering
Memorandum if the Offering Memorandum were a prospectus
included in a registration statement on Form S-1 that have
not been
so described in the Offering Memorandum (exclusive
of any amendments thereto after the date hereof).
(xxiii) Tax Returns and Payment of Taxes. The Company
and its subsidiary have timely filed all Federal, state,
local and foreign tax returns that are required to be filed
or have duly requested extensions thereof and all such tax
returns are true, correct and complete, except to the extent
that any failure to file or request an extension, or any
incorrectness could not reasonably be expected to, singly
and in the aggregate, result in a Material Adverse Effect.
The Company and its subsidiary have timely paid all taxes
shown as due on such filed tax returns (including any
related assessments, fines or penalties), except to the
extent that any such taxes are being contested in good faith
and by appropriate proceedings, or to the extent that any
failure to pay could not reasonably be expected to, singly
and in the aggregate, result in a Material Adverse Effect;
and adequate charges, accruals and reserves have been
provided for in the financial statements referred to in
Section 1(a)(iii) above in accordance with GAAP in respect
of all Federal, state, local and foreign taxes for all
periods as to which the tax liability of the Company or its
subsidiary has not been finally determined or remains open
to examination by applicable taxing authorities. Neither
the Company nor its subsidiary is a "United States real
property holding corporation" within the meaning of
Section 897(c)(2) of the Internal Revenue Code of 1986, as
amended.
(xxiv) Insurance. The Company and its subsidiary are
insured by insurers of recognized financial responsibility
against such losses and risks and in such amounts as are
prudent and customary in the businesses in which they are
engaged; and the Company has no reason to believe that the
Company or its subsidiary will not be able to renew its
existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business, except where
the failure to renew or maintain such coverage could not
reasonably be expected to result in a Material Adverse
Effect.
(xxv) Year 2000. The Company has reviewed its operations
and those of its subsidiary and has made inquiries of any
third party with which the Company or its subsidiary has a
material relationship to evaluate the extent to which the
business or operations of the Company or its subsidiary will
be affected by the Year 2000 Problem. Other than as set
forth in the Offering Memorandum, the Company does not
anticipate incurring operating expenses or costs material to
the financial position or results of operations of the
Company and its subsidiary in connection with the actions
that the Company currently believes are necessary to address
the Year 2000 Problem. As a result of the aforementioned
review, the
Company has no reason to believe, and does not
believe, that the Year 2000 Problem will have a Material
Adverse Effect on the Company and its subsidiary considered
as one enterprise or result in any material loss or
interference with the business or operations of the Company
or its subsidiary. The "Year 2000 Problem" as used herein
means any risk that computer hardware or software used in
the receipt, transmission, processing, manipulation,
storage, retrieval, retransmission or other utilization of
data or in the operation of mechanical or electrical systems
of any kind will not, in the case of dates or time periods
occurring after December 31, 1999, function at least as
effectively as in the case of dates or time periods
occurring prior to January 1, 2000.
(xxvi) Environmental Laws. Except as described in the
Offering Memorandum (exclusive of any amendments thereto
after the date hereof) and except such matters as could not
reasonably be expected to, singly and in the aggregate,
result in a Material Adverse Effect, (A) neither the Company
nor its subsidiary is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any
judicial or administrative order, consent, decree or
judgment, relating to pollution or protection of human
health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or
threatened release of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or
to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"),
(B) the Company and its subsidiary have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened
administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of
noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or its
subsidiary and (D) there are no events or circumstances that
could form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private
party or governmental body or agency, against or affecting
the Company or its subsidiary relating to Hazardous
Materials or Environmental Laws.
(xxvii) Solvency of the Company. The Company is, and
immediately after the Closing Time will be, Solvent. As
used herein, the term "Solvent" means, with respect to the
Company on a particular date, that on such date (a) the fair
market value of the assets of the Company is greater than
the total amount of
liabilities (including contingent
liabilities) of the Company, (b) the present fair salable
value of the assets of the Company is greater than the
amount that will be required to pay the probable liabilities
of the Company on its debts as they become absolute and
matured, (c) the Company is able to realize upon its assets
and pay its debts and other liabilities, including
contingent obligations, as they mature and (d) the Company
does not have unreasonably small capital.
(xxviii) Absence of Price Stabilization. Neither the
Company nor any of its affiliates, as such term is defined
in Rule 501(b) under the 1933 Act (each, an "Affiliate"),
has taken or will take, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of
any security of the Company, or which caused or resulted in,
or which could in the future cause or result in,
stabilization or manipulation of the price of any security
of the Company, nor has the Company become aware that any of
its Affiliates has taken, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of
any security of the Company, or which caused or resulted in,
or which could in the future cause or result in
stabilization or manipulation of the price of any security
of the Company.
(xxix) Investment Company Act. The Company is not, and
upon the issuance and sale of the Securities as herein
contemplated and the application of the net proceeds
therefrom as described in the Offering Memorandum will not
be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxx) Registration Rights. Except as described in the
Offering Memorandum (exclusive of any amendments thereto
after the date hereof), there are no persons with
registration rights or other similar rights to have any
securities of the Company or its subsidiary registered under
the 1933 Act.
(xxxi) Similar Offerings. Neither the Company nor any of
its Affiliates has, directly or indirectly, solicited any
offer to buy, sold or offered to sell or otherwise
negotiated in respect of, or will solicit any offer to buy
or offer to sell or otherwise negotiate in respect of, in
the United States or to any United States citizen or
resident, any security which is or could be integrated with
the sale of the Securities in a manner that could require
the Securities to be registered under the 1933 Act.
(xxxii) Rule 144A Eligibility. The Securities are
eligible for resale pursuant to Rule 144A and will not be,
at the Closing Time, of the same class as
securities listed on a national securities exchange registered under
Section 6 of the 1934 Act, or quoted in a U.S. automated interdealer
quotation system.
(xxxiii) No General Solicitation. None of the Company,
its Affiliates or any person acting on its or any of their
behalf (other than the Initial Purchasers, as to whom the
Company makes no representation) has engaged or will engage,
in connection with the offering of the Securities, in any
form of general solicitation or general advertising within
the meaning of Rule 502(c) under the 1933 Act.
(xxxiv) Related Party Transactions. There is no
relationship, direct or indirect, between or among the
Company on the one hand, and the directors, officers,
shareholders, customers or suppliers of the Company on the
other hand, which is required to be described in the 1934
Act Reports that has not been so described.
(xxxv) No Registration Required. Subject to compliance by
the Initial Purchasers with the procedures set forth in
Section 6 hereof, it is not necessary in connection with the
offer, sale and delivery of the Securities to the Initial
Purchasers and to each Subsequent Purchaser in the manner
contemplated by this Agreement and the Offering Memorandum
to register the Securities under the 1933 Act or to qualify
the Indenture under the 1939 Act.
(xxxvi) Reporting Company; Nasdaq Listing. The Company
is subject to and in compliance with the reporting
requirements of Section 13 or Section 15(d) of the 1934 Act.
The Common Stock is registered pursuant to Section 12(g) of
the 1934 Act and is listed on the Nasdaq National Market,
and the Company has taken no action designed to, or likely
to have the effect of, terminating the registration of the
Common Stock under the 1934 Act or delisting the Common
Stock from the Nasdaq National Market, nor has the Company
received any notification that the Commission or the NASD is
contemplating terminating such registration or listing.
(xxxvii) Accounting Controls. The Company and its
subsidiary maintain a system of internal accounting controls
sufficient to provide reasonable assurances that (a)
transactions are executed in accordance with management's
general or specific authorization, (b) transactions are
recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting
principles and to maintain accountability for assets, (c)
access to assets is permitted only in accordance with
management's general or specific authorization and (d) the
recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(b) Officer's Certificates. Any certificate signed by any
officer of the Company or its subsidiary delivered to the
Representatives or to counsel for the Initial Purchasers
shall be deemed a representation and warranty by the Company
to the Initial Purchasers as to the matters covered thereby.
SECTION 2. Sale and Delivery to Initial Purchasers;
Closing.
(a) Securities. On the basis of the representations and
warranties herein contained and subject to the terms and
conditions herein set forth, the Company agrees to sell to
each Initial Purchaser and each Initial Purchaser agrees to
purchase from the Company, severally and not jointly, at the
price set forth in Schedule B, the aggregate principal
amount of Initial Securities set forth in Schedule A
opposite the name of such Initial Purchaser.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject
to the terms and conditions herein set forth, the Company
hereby grants an option to the Initial Purchasers severally
and not jointly to purchase up to an additional $26,250,000
aggregate principal amount of Securities at the same price
set forth in Schedule B for the Initial Securities, plus
accrued interest, if any, from the date of the Closing Time
(as hereinafter defined) to the relevant Date of Delivery
(as hereinafter defined). The option hereby granted will
expire 30 days after the date hereof and may be exercised in
whole or in part from time to time only for the purpose of
covering over-allotments which may be made in connection
with the offering and distribution of the Initial Securities
upon notice by Xxxxxxx Xxxxx the Company setting forth the
number of Option Securities as to which the Initial
Purchasers are then exercising the option and the time and
date of payment and delivery for such Option Securities.
Any such time and date of delivery (a "Date of Delivery")
shall be determined by the Representatives, but shall not be
later than seven full business days after the exercise of
such option, nor in any event prior to the Closing Time. If
the option is exercised as to all or any portion of the
Option Securities, each of the Initial Purchasers, acting
severally and not jointly, will purchase that proportion of
the total number of Option Securities then being purchased
which the number of Initial Securities set forth in Schedule
A opposite the name of such Initial Purchasers bears to the
total number of Initial Securities, subject in each case to
such adjustments as Xxxxxxx Xxxxx in its discretion shall
make to eliminate any sales or purchases of fractional
shares.
(c) Payment. Payment of the purchase price for, and
delivery of certificates for, the Initial Securities shall
be made at the office of Debevoise & Xxxxxxxx, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other place as
shall be agreed upon by
the Representatives and the Company,
at 9:00 a.m. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 p.m. (Eastern time) on any given
day) business day after the date hereof, or such other time
not later than ten business days after such date as shall be
agreed upon by the Representatives and the Company (such
time and date of payment and delivery being herein called
the "Closing Time").
In addition, in the event that any or all of the Option
Securities are purchased by the Initial Purchasers, payment
of the purchase price for, and delivery of certificates for,
such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by
the Representatives and the Company, on each Date of
Delivery as specified in the notice from the Representatives
to the Company. Payment shall be made to the Company by
wire transfer of immediately available funds to a bank
account designated by the Company, against delivery to the
Initial Purchasers of certificates for the Securities to be
purchased by them. It is understood that each Initial
Purchaser has authorized Xxxxxxx Xxxxx, for its account, to
accept delivery of, receipt for, and make payment of the
purchase price for, the Initial Securities and the Option
Securities, if any, which it has agreed to purchase.
Xxxxxxx Xxxxx, individually and not as representative of the
Initial Purchasers, may (but shall not be obligated to) make
payment of the purchase price for the Initial Securities or
the Option Securities, if any, to be purchased by any
Initial Purchaser whose funds have not been received by the
Closing Time or the relevant Date of Delivery, as the case
may be, but such payment shall not relieve such Initial
Purchaser from its obligations hereunder.
(d) Denominations; Registration. Certificates for the
Initial Securities and the Option Securities, if any, shall
be in such denominations ($100,000 or integral multiples of
$1,000 in excess thereof) and registered in such names as
the Representatives may request in writing at least one full
business day before the Closing Time or the relevant Date of
Delivery, as the case may be. The certificates, which may
be in temporary form, for the Initial Securities and the
Option Securities, if any, shall be made available for
examination and packaging by the Representatives in The City
of New York not later than 10:00 a.m. (Eastern time) on the
last business day prior to the Closing Time or the relevant
Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company
covenants with each Initial Purchaser as follows:
(a) Offering Memorandum. The Company, as promptly as
possible, will furnish to each Initial Purchaser, without
charge, such number of copies of the Preliminary Offering
Memorandum, the Final Offering Memorandum and any amendments
and supplements thereto and documents incorporated by
reference therein as such Initial Purchaser may reasonably
request.
(b) Notice and Effect of Material Events. The Company
will immediately notify the Initial Purchasers, and confirm
such notice in writing, of (x) any filing made by the
Company of information relating to the offering of the
Securities with any securities exchange or any other
regulatory body in the United States or any other
jurisdiction, and (y) prior to the completion of the
placement of the Securities by the Initial Purchasers as
evidenced by a notice in writing from the Initial Purchasers
to the Company, any material changes in or affecting the
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its
subsidiary considered as one enterprise which (i) make any
statement in the Offering Memorandum false or misleading or
(ii) are not disclosed in the Offering Memorandum. In such
event or if during such time any event shall occur or
condition exist as a result of which it is necessary, in the
reasonable opinion of any of the Company, its counsel, the
Initial Purchasers or counsel for the Initial Purchasers, to
amend or supplement the Final Offering Memorandum in order
that the Final Offering Memorandum not include any untrue
statement of a material fact or omit to state a material
fact necessary in order to make the statements therein not
misleading in the light of the circumstances then existing,
the Company will forthwith amend or supplement the Final
Offering Memorandum by preparing and furnishing to each
Initial Purchaser an amendment or amendments of, or a
supplement or supplements to, the Final Offering Memorandum
(in form and substance satisfactory in the reasonable
opinion of counsel for the Initial Purchasers) so that, as
so amended or supplemented, the Final Offering Memorandum
will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances
existing at the time it is delivered to a Subsequent
Purchaser, not misleading.
(c) Amendment to Offering Memorandum and Supplements. The
Company will advise the Initial Purchasers promptly of any
proposal to amend or supplement the Offering Memorandum and
will not effect such amendment or supplement without the
consent of the Initial Purchasers. Neither the consent of
the Initial Purchasers, nor the Initial Purchasers' delivery
of any such amendment or supplement, shall constitute a
waiver of any of the conditions set forth in Section 5
hereof.
(d) DTC. The Company will cooperate with the Initial
Purchasers and use its best efforts to permit the Securities
to be eligible for clearance and settlement through the
facilities of DTC.
(e) Use of Proceeds. The Company will use the net
proceeds received by it from the sale of the Securities in
the manner specified in the Offering Memorandum under "Use
of Proceeds."
(f) Listing. The Company will use its best efforts to
effect and maintain the listing of the shares of Common
Stock issuable upon conversion of the Securities on the
Nasdaq National Market.
(g) Restriction on Sale of Securities. During a period of
90 days from the date of the Offering Memorandum, the
Company will not, without the prior written consent of the
Xxxxxxx Xxxxx, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer
or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for or
repayable with Common Stock or file any registration
statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of
ownership of the Common Stock, whether any such swap or
transaction described in clause (i) or (ii) above is to be
settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence
shall not apply to (A) the Securities to be sold hereunder
and the common stock that may be issued upon conversion of
the Security pursuant to their terms, (B) any shares of
Common Stock issued by the Company upon the exercise of an
option or warrant or the conversion of a security
outstanding on the date hereof and referred to in the
Offering Memorandum, (C) any shares of Common Stock issued
or options or rights to purchase Common Stock granted
pursuant to existing employee benefit plans of the Company
or (D) any shares of Common Stock issued pursuant to any non-
employee director stock plan or dividend reinvestment plan.
(h) PORTAL Designation. The Company will use its best
efforts to permit the Securities to be designated PORTAL
securities in accordance with the rules and regulations
adopted by the National Association of Securities Dealers,
Inc. ("NASD") relating to trading in the PORTAL Market.
(i) Reporting Requirements. The Company, during the
period when the Offering Memorandum is required to be
delivered pursuant to Section 6(a)(vii) hereof, will file
all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by
the 1934 Act and the 1934 Act Regulations.
(j) Registration Rights Agreement; Trust Indenture Act.
The Company agrees that it will comply with all the terms
and conditions of the Registration Rights Agreement and that
prior to any registration of the Securities pursuant to the
Registration Rights Agreement, or at such earlier time as
may be required, that it will cause the Indenture to be
qualified under the 1939 Act.
(k) The Company will use its best efforts to obtain a
waiver from each person who would otherwise have the right
to have Securities of the Company (other than shares of
Common Stock issuable upon conversion of the Notes)
registered on the registration statement filed pursuant to
the Registration Rights Agreement ("the Resale Registration
Statement"). To the extent the Company does not receive
such waivers, the Company will use its best efforts to
obtain the consent of such persons from whom waivers are not
obtained to file a separate registration statement with
respect to all such other registrable securities, rather
than include them in the Resale Registration Statement and,
upon receipt of such consent, to register such registrable
securities in accordance therewith.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident
to the performance of its obligations under this Agreement,
including (i) the preparation, printing, delivery to the
Initial Purchasers and any filing of the Offering Memorandum
(including financial statements and any schedules or
exhibits and any document incorporated therein by reference)
and of each amendment or supplement thereto, (ii) the
preparation, printing and delivery to the Initial Purchasers
of this Agreement, the Indenture and such other documents as
may be required in connection with the offering, purchase,
sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for
the Securities to the Initial Purchasers and the
certificates for the shares of Common Stock issuable upon
conversion thereof, including any stock or other transfer
taxes, any stamp or other duties payable upon the sale,
issuance and delivery of the Securities to the Initial
Purchasers and any charges of DTC in connection therewith,
(iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the reasonable fees and
disbursements of counsel for the Initial Purchasers in
connection with the preparation of the Blue Sky Survey,
(vi) the fees and expenses of the Trustee, any transfer
agent or registrar for the Securities or the Common Stock,
including the fees and disbursements of counsel for the
Trustee in connection with the Indenture and the Securities,
(vii) any fees and expenses payable in connection with the
initial and continued designation of the Securities as
PORTAL securities under the PORTAL Market Rules pursuant to
NASD Rule 5322, (viii) the fees and expenses payable in
connection with the listing of the shares of Common Stock
issuable upon conversion of the Securities on the Nasdaq
National Market and (ix) the performance by the Company of
its obligations under the Registration Rights Agreement.
(b) Termination of Agreement. If this Agreement is
terminated by the Representatives in accordance with the
provisions of Section 5 or Section 10(a)(i) hereof, the
Company shall reimburse the Initial Purchasers for all of
their out-of-pocket expenses, including the reasonable fees
and disbursements of counsel for the Initial Purchasers.
SECTION 5. Conditions of Initial Purchasers'
Obligations. The obligations of the several Initial
Purchasers hereunder are subject to the accuracy of the
representations and warranties contained in Section 1 hereof
or in certificates of any officer of the Company or its
subsidiary delivered pursuant to the provisions hereof, to
the performance by the Company of its covenants and other
obligations hereunder, and to the following further
conditions:
(a) Opinion of Counsel for Company. At the Closing Time,
the Representatives shall have received the favorable
opinions, dated as of the Closing Time, of Xxxxxx Godward
LLP, counsel for the Company, XxXxxxxxx Xxxxxxx Xxxxxxx &
Xxxxxxxx, special intellectual property counsel for the
Company, Xxxxxxxxx & Xxxxxxx, special regulatory counsel for
the Company and Xxxxxx Xxxxxx & Company, special Cayman
Islands counsel for the Company, in form and substance
satisfactory to counsel for the Initial Purchasers, to the
effect set forth in Exhibits A-1, A-2, A-3 and A-4,
respectively, hereto and to such further effect as counsel
to the Initial Purchaser may reasonably request.
(b) Opinion of Counsel for Initial Purchasers. At the
Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of
Debevoise & Xxxxxxxx, counsel for the Initial Purchasers, in
form and substance reasonably satisfactory to the Initial
Purchasers.
(c) Officers' Certificate. At the Closing Time, there
shall not have been, since the date hereof or since the
respective dates as of which information is given in the
Offering Memorandum, any material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and
its subsidiary considered as one enterprise, whether or not
arising in the ordinary course of business, and the
Representatives shall have received a certificate of the
President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company,
dated as of the Closing Time, to the effect that (i) there
has been no such material adverse change, (ii) the
representations and warranties in Section 1 hereof are true
and correct with the same force and effect as though
expressly made at and as of the Closing Time, and (iii) the
Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or
prior to the Closing Time.
(d) Accountants' Comfort Letter. At the time of the
execution of this Agreement, the Representatives shall have
received from Ernst & Young LLP a letter dated such date, in
form and substance satisfactory to the Initial Purchasers,
containing statements and information of the type ordinarily
included in accountants' "comfort letters" with respect to
the financial statements and certain financial information
contained in or incorporated by reference into the Offering
Memorandum.
(e) Bring-down Comfort Letter. At the Closing Time, the
Representatives shall have received from Ernst & Young LLP a
letter, dated as of the Closing Time, to the effect that
they reaffirm the statements made in the letter furnished
pursuant to subsection (d) of this Section, except that the
specified date referred to shall be a date not more than
three business days prior to the Closing Time.
(f) PORTAL. At the Closing Time, the Securities and the
Common Stock issuable upon conversion of the Securities
shall have been designated for trading on PORTAL.
(g) Approval for Listing. At the Closing Time, the shares
of Common Stock issuable upon conversion of the Securities
shall have been approved for listing on the Nasdaq National
Market.
(h) No Downgrading. Since the date of this Agreement,
there shall not have occurred a downgrading in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as that term is
defined by the Commission for purposes of Rule 436(g)(2)
under the 1933 Act, and no such securities rating
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications,
its ratings of any of the Company's securities.
(i) Lock-up Agreements. At the date of this Agreement,
the Representatives shall have received an agreement
substantially in the form of Exhibit C hereto signed by the
persons listed on Schedule C hereto.
(j) Conditions to Purchase of Option Securities. In the
event that the Initial Purchasers exercises their option
provided in Section 2(b) hereof to purchase all or any
portion of the Option Securities, the representations and
warranties contained in Section 1 hereof and the statements
in any certificates furnished by the Company or any
subsidiary of the Company hereunder shall be true and
correct as of each Date of Delivery and, at the relevant
Date of Delivery, the Representatives shall have received:
(i) Officers' Certificate. A certificate, dated such Date
of Delivery, of the President or a Vice President of the
Company and of the chief financial or chief accounting
officer of the Company confirming that the certificate
delivered at Closing Time pursuant to Section 5(c) hereof
remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable
opinions of Xxxxxx Godward LLP, counsel for the Company,
XxXxxxxxx Xxxxxxx Xxxxxxx & Xxxxxxxx, special intellectual
property for the Company, Xxxxxxxxx & Xxxxxxx, special
regulatory counsel for the Company and Xxxxxx Xxxxxx &
Company,
special Cayman Islands counsel to the Company, in
form and substance satisfactory to counsel for the Initial
Purchasers, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinions required by
Section 5(a) hereof.
(iii) Opinion of Counsel for Initial Purchasers. The
favorable opinion of Xxxxxxxxx & Xxxxxxxx, counsel for the
Initial Purchasers, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iv) Bring-down Comfort Letter. A letter from Xxxxx &
Young LLP, in form and substance satisfactory to the
Representatives and dated such Date of Delivery,
substantially in the same form and substance as the letter
furnished to the Representatives pursuant to Section 5(e)
hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not
more than five days prior to such Date of Delivery.
(v) No Downgrading. Subsequent to the date of this
Agreement, no downgrading shall have occurred in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as that term is
defined by the Commission for purposes of Rule 436(g)(2)
under the 1933 Act, and no such securities rating
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications,
its ratings of any of the Company's securities.
(k) Additional Documents. At the Closing Time and at each
Date of Delivery, counsel for the Initial Purchasers shall
have been furnished with such documents and opinions as they
may require for the purpose of enabling them to pass upon
the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of
the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and
sale of the Securities as herein contemplated shall be
satisfactory in form and substance to the Representatives
and counsel for the Initial Purchasers.
(l) Termination of Agreement. If any condition specified
in this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement, or, in the case of
any condition to the purchase of Option Securities, on a
Date of Delivery which is after the Closing Time, the
obligations of the several Initial Purchasers to purchase
the relevant Option Securities, may be terminated by the
Representatives by notice to the Company at any time at or
prior to the Closing Time or such Date of Delivery, as the
case may be, and such termination shall be without
liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 7, 8 and
9 shall survive any such termination and remain in full force and
effect.
SECTION 6. Subsequent Offers and Resales of the
Securities.
(a) Offer and Sale Procedures. Each Initial Purchaser and
the Company hereby establish and agree to observe the
following procedures in connection with the offer and sale
of the Securities:
(i) Offers and Sales only to Qualified Institutional
Buyers. Offers and sales of the Securities shall only be
made to persons whom the offeror or seller reasonably
believes to be qualified institutional buyers, as defined in
Rule 144A under the 1933 Act ("Qualified Institutional
Buyers").
(ii) No General Solicitation. No general solicitation
or general advertising (within the meaning of Rule 502(c)
under the 1933 Act) will be used in the United States in
connection with the offering or sale of the Securities.
(iii) Purchases by Non-Bank Fiduciaries. In the case of
a non-bank Subsequent Purchaser of a Security acting as a
fiduciary for one or more third parties, each third party
shall, in the judgment of such Initial Purchaser, be a
Qualified Institutional Buyer.
(iv) Subsequent Purchaser Notification. Each Initial
Purchaser will take reasonable steps to inform, and cause
each of its U.S. Affiliates to take reasonable steps to
inform, persons acquiring Securities from such Initial
Purchaser or affiliate, as the case may be, in the United
States that the Securities (A) have not been and will not be
registered under the 1933 Act, (B) are being sold to them
without registration under the 1933 Act in reliance on Rule
144A, and (C) may not be offered, sold or otherwise
transferred except (1) to the Company or any subsidiary
thereof or (2) in accordance with Rule 144A to a person whom
the seller reasonably believes is a Qualified Institutional
Buyer that is purchasing such Securities for its own account
or for the account of a Qualified Institutional Buyer to
whom notice is given that the offer, sale or transfer is
being made in reliance on Rule 144A.
(v) Minimum Principal Amount. No sale of the Securities
to any one Subsequent Purchaser will be for less than U.S.
$100,000 principal amount and no Security will be issued in
a smaller principal amount. If the Subsequent Purchaser is
a non-bank fiduciary acting on behalf of others, each person
for whom it is acting must purchase at least U.S. $100,000
principal amount of the Securities.
(vi) Restrictions on Transfer. The transfer
restrictions and the other provisions set forth in the
Offering Memorandum under the heading "Notice to Investors,"
including the legend required thereby, shall apply to the
Securities and the Common Stock issuable upon the conversion
thereof except as otherwise agreed by the Company and the
Initial Purchasers.
(vii) Delivery of Offering Memorandum. Each Initial
Purchaser will deliver to each purchaser of the Securities
from such Initial Purchaser, in connection with its original
distribution of the Securities, a copy of the Offering
Memorandum, as amended and supplemented at the date of such
delivery.
(b) Covenants of the Company. The Company covenants with
each Initial Purchaser as follows:
(i) Integration. The Company agrees that it will not and
will cause its Affiliates not to, directly or indirectly,
solicit any offer to buy, sell or make any offer or sale of,
or otherwise negotiate in respect of, securities of the
Company of any class if, as a result of the doctrine of
"integration" referred to in Rule 502 under the 1933 Act,
such offer or sale could render invalid (for the purpose of
(i) the sale of the Securities by the Company to the Initial
Purchasers, (ii) the resale of the Securities by any Initial
Purchaser to Subsequent Purchasers or (iii) the resale of
the Securities by such Subsequent Purchasers to others) the
exemption from the registration requirements of the 1933 Act
provided by Section 4(2) thereof or by Rule 144A thereunder
or otherwise.
(ii) Rule 144A Information. The Company agrees that, in
order to render the Securities eligible for resale pursuant
to Rule 144A under the 1933 Act, while any of the Securities
remain outstanding, it will make available, upon request, to
any holder of Securities or prospective purchasers of
Securities the information specified in Rule 144A(d)(4),
unless the Company furnishes information to the Commission
pursuant to Section 13 or 15(d) of the 1934 Act.
(iii) Restriction on Repurchases. Until the expiration
of two years after the original issuance of the Securities,
the Company will not, and will cause its Affiliates not to,
resell any Securities which are "restricted securities" (as
such term is defined under Rule 144(a)(3) under the 1933
Act), whether as beneficial owner or otherwise (except as
agent acting as a securities broker on behalf of and for the
account of customers in the ordinary course of business in
unsolicited broker's transactions).
(c) Qualified Institutional Buyer. Each Initial Purchaser
severally and not jointly represents and warrants to, and
agrees with, the Company that it is a "qualified
institutional buyer" within the meaning of Rule 144A under
the 1933 Act (a "Qualified
Institutional Buyer") and an "accredited investor" within the meaning
of Rule 501(a) under the 1933 Act (an "Accredited Investor").
(d) Additional Representations and Warranties of the
Initial Purchasers. Each Initial Purchaser severally and
not jointly represents and agrees that it has not entered
and will not enter into any contractual arrangements with
respect to the distribution of the Securities, except with
its affiliates or with the prior written consent of the
Company.
SECTION 7. Indemnification.
(a) Indemnification of the Initial Purchasers. The
Company agrees to indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial
Purchaser within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact
contained in any Preliminary Offering Memorandum or the
Final Offering Memorandum (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency
or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided that
(subject to Section 7(d) below) any such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by
the Xxxxxxx Xxxxx), reasonably incurred in investigating,
preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not
apply to any loss, liability, claim, damage or expense (x)
to the extent arising out of any untrue statement or
omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information
furnished to the Company by any Initial Purchaser
through Xxxxxxx Xxxxx expressly for use in the Offering Memorandum
(or any amendment thereto), and (y) with respect to the
Preliminary Offering Memorandum, to the extent that the
Company shall sustain the burden of proving (i) that any
such loss, claim, expense, damage or liability of such
Initial Purchaser results from the fact that such Initial
Purchaser sold the Notes to a person as to whom there was
not sent or given, at or prior to the written confirmation
of such sale, a copy of the Final Offering Memorandum (as
then amended or supplemented), (ii) that the Company had
previously furnished copies thereof in sufficient quantities
to such Initial Purchaser and the loss, claim, expense,
damage or liability of such Initial Purchaser results from
an untrue statement or omission of a material fact contained
in the Preliminary Offering Memorandum that was corrected in
the Final Offering Memorandum and (iii) that sending such
Final Offering Memorandum by the date of closing to the
person or persons asserting such loss, liability, claim,
damage or expense would have constituted a defense to the
claim asserted by such person or persons.
(b) Indemnification of Company. Each Initial Purchaser
severally agrees to indemnify and hold harmless the Company
and each person, if any, who controls the Company within the
meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Offering Memorandum in
reliance upon and in conformity with written information
furnished to the Company by such Initial Purchaser through
Xxxxxxx Xxxxx expressly for use in the Offering Memorandum.
(c) Actions against Parties; Notification. Each
indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any
action commenced against it in respect of which indemnity
may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party
from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. In
the case of parties indemnified pursuant to Section 7(a)
above, counsel to the indemnified parties shall be selected
by Xxxxxxx Xxxxx, and, in the case of parties indemnified
pursuant to Section 7(b) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying
party may participate at its own expense in the defense of
any such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to
any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or
separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this
Section or Section 8 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all
liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as
to or an admission of fault, culpability or a failure to act
by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse.
If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for
fees and expenses of counsel, such indemnifying party agrees
that it shall be liable for any settlement of the nature
contemplated by Section 7(a)(ii) effected without its
written consent if (i) such settlement is entered into more
than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have
received notice of the terms of such settlement at least 30
days prior to such settlement being entered into, and (iii)
such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to
the date of such settlement; provided that an indemnifying
party shall not be liable for any such settlement, if such
indemnifying party (1) reimburses such indemnified party in
accordance with such request for the amount of such fees and
expenses of counsel as the indemnifying party believes in
good faith to be reasonable, and (2) provides written notice
to the indemnified party that the indemnifying party
disputes in good faith the reasonableness of the unpaid
balance of such fees and expenses.
SECTION 8. Contribution. If the indemnification
provided for in Section 7 hereof is for any reason
unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities,
claims, damages or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the
Initial Purchasers on the other hand from the offering of
the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company on the
one hand and of the Initial Purchasers on the other hand in
connection with the statements or omissions which resulted
in such losses, liabilities, claims, damages or expenses, as
well as any other relevant equitable considerations.
The relative benefits received by the Company on the
one hand and the Initial Purchasers on the other hand in
connection with the offering of the Securities pursuant to
this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the total underwriting
discount received by the Initial Purchasers, bear to the
aggregate initial offering price of the Securities.
The relative fault of the Company on the one hand and
the Initial Purchasers on the other hand shall be determined
by reference to, among other things, whether any such untrue
or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to
information supplied by the Company or by the Initial
Purchasers and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to
this Section were determined by pro rata allocation (even if
the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to
above in this Section. The aggregate amount of losses,
liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section
shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in
investigating, preparing or defending against any
litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section, no
Initial Purchaser shall be required to contribute any amount
in excess of the amount by which the total price at which
the Securities purchased and sold by it hereunder exceeds
the amount of any damages which such Initial Purchaser has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who
controls an Initial Purchaser within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as such Initial Purchaser,
and each person, if any, who controls the Company within the
meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the
Company. The Initial Purchasers' respective obligations to
contribute pursuant to this Section 8 are several in
proportion to the principal amount of Securities set forth
opposite their respective names in Schedule A hereto and not
joint.
SECTION 9. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and
agreements contained in this Agreement or in certificates of
officers of the Company or its subsidiary submitted pursuant
hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any
Initial Purchaser or controlling person, or by or on behalf
of the Company, and shall survive delivery of the Securities
to the Initial Purchasers.
SECTION 10. Termination of Agreement.
(a) Termination; General. The Representatives may
terminate this Agreement, by notice to the Company, at any
time at or prior to the Closing Time (i) if there has been,
since the time of execution of this Agreement or since the
respective dates as of which information is given in the
Offering Memorandum, any material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and
its subsidiary considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there
has occurred any material adverse change in the financial
markets in the United States or the international financial
markets, any outbreak of hostilities or escalation thereof
or other calamity or crisis or any change or development
involving a prospective change in national or international
political, financial or economic conditions, in each case
the effect of which is such as to make it, in the judgment
of the Representatives, impracticable to market the
Securities or to enforce contracts for the sale of the
Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the
Commission or the Nasdaq National Market, or if trading
generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been
suspended or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) if a banking moratorium has
been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant
to this Section, such termination shall be without liability
of any party to any other party except as provided in
Section 4 hereof, and provided further that Sections 1, 7, 8
and 9 shall survive such termination and remain in full
force and effect.
SECTION 11. Default by One or More of the Initial
Purchasers. If one or more of the Initial Purchasers shall
fail at the Closing Time to purchase the Securities which it
or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the
Representatives shall have the right, within 24 hours thereafter,
to make arrangements for one or more of the non-defaulting Initial
Purchasers, or any other initial purchasers, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if,
however, the Representatives shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed
10% of the aggregate principal amount of the Securities to
be purchased hereunder, each of the non-defaulting Initial
Purchasers shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to
the underwriting obligations of all non-defaulting Initial
Purchasers, or
(b) if the number of Defaulted Securities exceeds 10% of
the aggregate principal amount of the Securities to be
purchased hereunder, this Agreement shall terminate without
liability on the part of any non-defaulting Initial
Purchaser.
No action taken pursuant to this Section shall relieve
any defaulting Initial Purchaser from liability in respect
of its default.
In the event of any such default which does not result
in a termination of this Agreement, either the
Representatives or the Company shall have the right to
postpone the Closing Time for a period not exceeding seven
days in order to effect any required changes in the Offering
Memorandum or in any other documents or arrangements.
SECTION 12. Notices. All notices and other
communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the
Initial Purchasers shall be directed to them at North Tower,
World Financial Center, New York, New York 10281, attention
of Syndicate Operations, with a copy to Debevoise &
Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000,
xxxxxxxxx of Xxxxx X. Xxxxxxxx; notices to the Company shall
be directed to it at 0000 Xxxxxx Xxxxx, Xxxx Xxxx,
Xxxxxxxxxx 00000, xxxxxxxxx of Xxxxx X. Xxxxx with a copy to
Xxxxxx Godward LLP, 0 Xxxx Xxxx Xxxxxx, Xxxx Xxxx,
Xxxxxxxxxx 00000, attention of Xxxx X. Xxxxxxxxx.
SECTION 13. Parties. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the
Company and their respective successors. Nothing expressed
or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other
than the Initial Purchasers and the Company and their
respective successors and the controlling persons and
officers and directors referred to in Sections 7 and 8 and
their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be
for the sole and exclusive benefit of the Initial Purchasers
and the Company and
their respective successors, and said
controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of
Securities from the Initial Purchasers shall be deemed to be
a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW
YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section
headings herein are for convenience only and shall not
affect the construction hereof.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement
among the Initial Purchasers and the Company in accordance
with its terms.
Very truly yours,
CV THERAPEUTICS, INC.
By
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
X.X. XXXXXX SECURITIES INC.
FLEETBOSTON XXXXXXXXX XXXXXXXX INC.
XX XXXXX SECURITIES CORPORATION
By: XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By:
Authorized Signatory
For themselves and as Representatives of the other Initial
Purchasers named in Schedule A hereto.
SCHEDULE A
Name of Initial Purchaser
Principal Amount
of Securities
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated 87,002,000
X.X. Xxxxxx Securities Inc. 29,166,000
FleetBoston Xxxxxxxxx Xxxxxxxx Inc. 29,166,000
XX Xxxxx Securities Corporation 29,166,100
Total $175,000,000
SCHEDULE B
CV Therapeutics, Inc.
$175,000,000 4 3/4% Convertible Subordinated Notes due 2007
1. The initial offering price of the Securities shall be
100% of the principal amount thereof, plus accrued interest,
if any, from the date of issuance.
2. The purchase price to be paid by the Initial
Purchasers for the Securities shall be 96.875% of the
principal amount thereof.
3. The interest rate on the Securities shall be 4_% per
annum.
4. The Securities shall be convertible into shares of the
Company's Common Stock, par value $.001 per share, at an
initial conversion price of $63.84 per share (equivalent to
a conversion rate of 15.6642 shares per $1,000 principal
amount of Securities).
5. The Securities may be redeemed at the option of the
Company prior to March 7, 2003, in whole or in part, if:
the closing price of the Company's common stock
has exceeded 150% of the conversion price then in
effect for at least 20 trading days within a period
of 30 consecutive trading days ending on the
trading day prior to the date of mailing of the
provisional redemption notice (which date shall be
at least 20 but not more than 60 trading days prior
to the provisional redemption date); and
the shelf registration statement covering resales
of the notes and the common stock issuable upon
conversion of the notes is effective and available
for use and is expected to remain effective for the
30 days following the provisional redemption date.
6. The provisional redemption price to be paid in the
event of a provisional redemption described in paragraph 5
above and to be supplied in the Offering Memorandum (and
correspondingly in the Indenture) shall be a price equal to
$1,000 per $1,000 principal amount of Notes to be redeemed
plus accrued and unpaid interest, if any, to the provisional
redemption date.
Upon any provisional redemption, the Company shall also
make an additional payment in cash with respect to the notes
called for redemption to holders on the notice date in an
amount equal to $107.14 per $1,000 principal amount of
notes, less the amount of any interest actually paid on the
notes prior to the notice date. The Company is
obligated to make this additional payment on all notes called for
provisional redemption, including any notes converted after
the notice date and before the provisional redemption date.
7. The Securities may be redeemed at the option of the
Company at any time after March 7, 2003 in whole or in part.
8. The redemption prices to be supplied in the Offering
Memorandum (and correspondingly in the Indenture) (expressed
as a percentage of principal amount) are as follows for the
12-month period specified below:
Year Redemption
Price
March 7, 2003 through March 6, 2004 102.714%
March 7, 2004 through March 6, 2005 102.036%
March 7, 2005 through March 6, 2006 101.357%
March 7, 2006 and thereafter 100.679%
SCHEDULE C
List of Persons Subject to Lock-Up
Xxxxx X. Xxxxx, M.D., Ph.D.
Xxxxxx X. Xxxxxxxxxx
Xxxxxx X. Xxxxx, M.D.
Xxxxx X. Xxxxxxxxx, Ph.D.
Xxxxxxx X. Xxxx, Ph.D.
Xxxxx X. XxXxxxx
Xxxxxx X. Xxxxxxxx
Xxxxxxx X. XxXxxx, M.D., Ph.X.
X. Xxxxxxxx Xxxx, M.D.
Xxxxx X. Xxxxxxxxxxxxx, Ph.X.
Xxxxx Xxxxx
Exhibit A-1
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware.
(ii) The Company has corporate power and authority to
own, lease and operate its properties and to conduct its
business as described in the Offering Memorandum and to
enter into and perform its obligations under the Purchase
Agreement, the Registration Rights Agreement, the Indenture
and the Securities.
(iii) The Company is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a
Material Adverse Effect.
(iv) The Company has an authorized capitalization as
set forth in the Offering Memorandum; the shares of issued
and outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-
assessable and are not subject to any preemptive or, to the
best of our knowledge, other similar rights of any
securityholder of the Company.
(v) To the best of our knowledge and information, the
Company does not have any subsidiaries other than CVTA.
(vi) The Purchase Agreement has been duly authorized,
executed and delivered by the Company.
(vii) The Indenture has been duly authorized, executed
and delivered by the Company and (assuming the due
authorization, execution and delivery thereof by the
Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with
its terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(viii) The Securities are in the form contemplated by the
Indenture, have been duly authorized by the Company and,
when executed by the Company and authenticated by the
Trustee in the manner provided in the Indenture (assuming
the due authorization,
execution and delivery of the Indenture by the Trustee) and issued
and delivered against payment of the purchase price therefor will
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium (including, without
limitation, all laws relating to fraudulent transfers), or
other similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law), and will be entitled to the
benefits of the Indenture.
(ix) The Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and
constitutes a valid and binding agreement of the Company,
enforceable against the Company in accordance with its
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
(x) If a California court were to apply California law in
any proceeding relating to the Indenture, the Securities and
the Registration Rights Agreement, each of them would
constitute a valid and binding agreement of the Company,
enforceable against the Company in accordance with their
terms under California law, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws
relating to or affecting enforcement of creditors' rights
generally, or by general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity
or at law).
(xi) Upon issuance and delivery of the Securities in
accordance with the Purchase Agreement and the Indenture,
the Securities shall be convertible at the option of the
holder thereof for shares of Common Stock in accordance with
the terms of the Securities and the Indenture; the shares of
Common Stock issuable upon conversion of the Securities have
been duly authorized and reserved for issuance upon such
conversion by all necessary corporate action; such shares,
when issued upon such conversion, will be validly issued and
will be fully paid and non-assessable and free and clear of
all liens, encumbrances, equities or claims imposed by or
arising from actions of the Company and no holder of such
Common Stock is or will be subject to personal liability by
reason of being such a holder.
(xii) The issuance of the shares of Common Stock upon
conversion of the Securities is not subject to the
preemptive or, to our knowledge, other similar rights of any
securityholder of the Company. There is no restriction upon
the voting or transfer of
any shares of common stock pursuant to the Company's certificate
of incorporation or bylaws.
(xiii) The Indenture conforms in all material respects
with the 1939 Act.
(xiv) The Securities, the Indenture and the Common Stock
conform in all material respects to the descriptions thereof
contained in the Offering Memorandum.
(xv) To the best of our knowledge, except as set forth in
the Offering Memorandum, there are no contracts, agreements
or understandings between the Company and any person
granting such person the right to (1) require the Company to
file a registration statement pursuant to the 1933 Act with
respect to any securities of the Company or (2) include in a
registration statement filed pursuant to the 1933 Act any
securities of the Company.
(xvi) To the best of our knowledge, except as disclosed in
the Offering Memorandum, there is not pending or overtly
threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any subsidiary is a
party, or to which the property of the Company or any
subsidiary thereof is subject, before or brought by a court
or governmental agency or body, which could reasonably be
expected to result in a Material Adverse Effect, or which
could reasonably be expected to materially and adversely
affect the properties or assets thereof or the consummation
of the transactions contemplated in the Purchase Agreement,
the Indenture, the Securities and the Registration Rights
Agreement or the performance by the Company of its
obligations thereunder or the transactions contemplated by
the Offering Memorandum.
(xvii) The information in the Offering Memorandum under
"Business-Collaborations and Licenses", "Description of
Notes," "Description of Capital Stock" and "United States
Federal Income Tax Considerations," to the extent that it
constitutes matters of law, summaries of legal matters or
legal documents or instruments, the Company's charter and
bylaws or legal proceedings, or legal conclusions, has been
reviewed by us and is correct in all material respects.
(xviii) All descriptions in the Offering Memorandum of
contracts and other documents to which the Company or its
subsidiary is a party are accurate in all material respects.
(xix) To the best of our knowledge, the Company is not in,
nor with the giving of notice or lapse of time would be, in
violation of or in default under its certificate of
incorporation or by-laws .
(xx) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of,
any court or governmental authority or agency,
domestic or foreign (other than such as may be required under the
applicable securities laws of the various jurisdictions in
which the Securities will be offered or sold, as to which we
need express no opinion) is necessary or required in
connection with the due authorization, execution and
delivery of the Purchase Agreement or the Registration
Rights Agreement or the due execution, delivery or
performance of the Indenture by the Company or for the
offering, issuance, sale or delivery of the Securities to
the Initial Purchasers or the resale by the Initial
Purchasers in accordance with the terms of the Purchase
Agreement or for the issuance of shares of Common Stock upon
conversion of Securities.
(xxi) It is not necessary in connection with the offer, sale
and delivery of the Securities to the Initial Purchasers and
to each Subsequent Purchaser in the manner contemplated by
the Purchase Agreement and the Offering Memorandum or in
connection with the conversion of the Notes into shares of
the Company's Common Stock in the manner contemplated in the
Indenture to register the Securities or the shares of Common
Stock issuable upon conversion of the Notes under the 1933
Act or to qualify the Indenture under the 1939 Act.
(xxii) The execution, delivery and performance of the
Purchase Agreement, the DTC Agreement, the Indenture, the
Registration Rights Agreement and the Securities and the
consummation of the transactions contemplated in the
Purchase Agreement, the Registration Rights Agreement and in
the Offering Memorandum (including the use of the proceeds
from the sale of the Securities as described in the Offering
Memorandum under the caption "Use Of Proceeds" and the
issuance of the shares of Common Stock issuable upon
conversion of the Securities) and compliance by the Company
with its obligations under the Purchase Agreement, the
Indenture, the Registration Rights Agreement and the
Securities do not and will not, whether with or without the
giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as
defined in Section 1(a)(xiv) of the Purchase Agreement)
under or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the
Company or its subsidiary thereof pursuant to any material
contract filed or incorporated by reference as an exhibit to
the Company's 1998 Form 10-K and Forms 10-Q for the quarters
ended March 31, June 30 and September 30, 1999 (except for
such conflicts, breaches or defaults or liens, charges or
encumbrances that could not reasonably be expected to have a
Material Adverse Effect), nor will such action result in any
violation of the provisions of the certificate of
incorporation or by-laws of the Company, or to our
knowledge, any applicable law, statute (except for the
securities or blue sky laws of the various states as to
which we express no opinion), rule, regulation, judgment,
order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its properties,
assets or operations.
(xxiii) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of
the proceeds thereof described in the Offering Memorandum,
will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are
defined in the 1940 Act.
Nothing has come to our attention that would lead us to
believe that the Offering Memorandum or any amendment or
supplement thereto (except for financial statements and
schedules, related notes, other financial data and
statistical data derived therefrom included therein or
omitted therefrom as to which we need make no statement), at
the time the Offering Memorandum was issued, at the time any
such amended or supplemented Offering Memorandum was issued
or at the Closing Time, included or includes an untrue
statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
In rendering such opinion, such counsel may rely as to
matters of fact (but not as to legal conclusions), to the
extent they deem proper, on certificates of responsible
officers of the Company and public officials. Such opinion
shall not state that it is to be governed or qualified by,
or that it is otherwise subject to, any treatise, written
policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of
the ABA Section of Business Law (1991).
Exhibit A-2
FORM OF OPINION OF COMPANY'S
INTELLECTUAL PROPERTY COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)
(i) To the best of our knowledge, the Company owns or
possesses all Intellectual Property currently employed by
them in connection with the business now operated by them
except where the failure to own or possess or otherwise be
able to acquire such Intellectual Property could not, singly
or in the aggregate, have a Material Adverse Effect.
(ii) Based upon a review of the third party rights
made known to us and discussions with scientific personnel
of the Company, we are not aware of any valid United States
or foreign patent, that is or would be infringed by the
activities of the Company in the manufacture, use or sale of
any presently proposed product, the technologies employed by
the Company or the method of their use in any presently
proposed product, each as described in the Offering
Memorandum and as such are related to the foregoing
technology and products.
(iii) We have reviewed the Company patent applications
which are identified in the Patent Schedule included with
this letter, and in such counsel's opinion the Company's
patent applications have been properly prepared and filed,
and are being diligently pursued by the Company, and the
inventions described in the Company patent applications are
owned by, have been assigned to or are licensed to the
Company.
(iv) To our knowledge except as disclosed in the
Offering Memorandum no party or individual has any right or
claim in any of the inventions, patents or patent
applications listed in the Patent Schedule and to the best
of our knowledge each of the Company's patent applications
discloses patentable subject matter.
(v) To the best of our knowledge, the Company is not
infringing or otherwise violating any Intellectual Property
of others, unless otherwise disclosed in the Offering
Memorandum. To the best of our knowledge, the Company has
not received any notice of infringement of or conflict with
asserted rights of others with respect to any Intellectual
Property.
(vi) We know of no legal or governmental proceedings
that are pending or, to the best of our knowledge, that are
threatened, relating to any Intellectual Property, except
(A) as disclosed in the Offering Memorandum or (B) which,
singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, could
have a Material Adverse Effect.
We are familiar with the Intellectual Property used by
the Company in its business and the manner of such use and
we have reviewed the Offering Memorandum, including
particularly the portions of the Offering Memorandum
describing or referring to any Intellectual Property
(collectively, the "Intellectual Property Disclosure"). We
have reviewed, among other things, the statements in the
Offering Memorandum under the captions:
"Risk Factors - We may be unable to effectively protect
our intellectual property, "
"Risk Factors -Our business depends on attracting and
retaining collaborators and licensors," and
"Business - Collaborations and Licenses," and "Business
- Patents and Proprietary Technology."
We have no reason to believe that the information
contained or incorporated by reference in the Intellectual
Property Disclosure in the Offering Memorandum at the time
the Offering Memorandum was issued, at the time any amended
or supplemented Offering Memorandum was issued or at the
Closing Time, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
In rendering such opinion, such counsel may rely as to
matters of fact (but not as to legal conclusions), to the
extent they deem proper, on certificates of responsible
officers of the Company and public officials. Such opinion
shall not state that it is to be governed or qualified by,
or that it is otherwise subject to, any treatise, written
policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of
the ABA Section of Business Law (1991).
Exhibit A-3
FORM OF OPINION OF COMPANY'S REGULATORY COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)
We have acted as special counsel to the Company with
respect to certain United States Food and Drug
Administration ("FDA") regulatory matters. In our capacity
as special FDA regulatory counsel to the Company, we have
reviewed at your request (1) those portions of the Offering
Memorandum set forth under the captions "Risk Factors - Our
product candidates will take at least several years to
develop, and we cannot assure you that we will successfully
develop, market, and manufacture these products", "Risk
Factors - If we are unable to satisfy the regulatory
requirements for our clinical trials, we will not be able to
commercialize our drug candidates", "Risk Factors - If we
are unable to satisfy governmental regulations relating to
the development of our drug candidates, we may be unable to
obtain necessary regulatory approvals to commercialize our
products", "Risk Factors - Our products, even if approved by
the FDA or foreign regulatory agencies, may not be accepted
by physicians, insurers or patients", "Risk Factors - We
have no manufacturing experience and will depend on third
parties to manufacture our products", "Risk Factors -
Failure to obtain adequate reimbursement from government
health administration authorities, private health insurers
and other organizations could materially adversely affect
our future business, results of operations and financial
condition", "Business-Manufacturing" and "Business -
Government Regulation" (collectively, the "Regulatory
Disclosure").
We have examined originals, or copies that are
identified as being true copies of originals, of submissions
made by the Company to the FDA pertaining to the Company's
product candidates identified in the Offering Memorandum and
related correspondence between FDA and the Company, clinical
trial protocols submitted to the FDA, representative
clinical investigator files for each clinical trial, and
records of drug shipments to investigators, in all such
cases pertaining to such product candidates, which documents
were identified to us by the Company as all of the material
FDA regulatory documents and communications in the Company's
possession. We have also relied upon oral statements of
Company representatives as to matters of fact and have made
no other investigation of fact.
(i) the statements in the Regulatory Disclosure,
insofar as such statements purport to describe or summarize
applicable provisions of the Federal Food, Drug, and
Cosmetic Act ("FDCA") and the regulations promulgated
thereunder, are accurate and complete in all material
respects and fairly present the information set forth
therein;
(ii) the Company has obtained such licenses, permits,
approvals, and authorizations required by the FDA that are
necessary for the conduct of the business of the Company as
it is currently conducted and described in the Offering
Memorandum and to our knowledge such authorizations are in
effect;
(iii) we are not aware of any lawsuit or regulatory
proceeding, pending or threatened, brought by or before the
FDA, in which the Company is or would be the defendant or
respondent, nor are we aware of any adverse judgment,
decree, or order currently in effect that has been issued by
the FDA against the Company.
We have no reason to believe that the information
contained in the Regulatory Disclosure in the Offering
Memorandum at the time the Offering Memorandum was issued,
at the time any amended or supplemented Offering Memorandum
was issued or at the Closing Time, included or includes an
untrue statement of a material fact or omitted or omits to
state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading.
In rendering such opinion, such counsel may rely as to
matters of fact (but not as to legal conclusions), to the
extent they deem proper, on certificates of responsible
officers of the Company and public officials. Such opinion
shall not state that it is to be governed or qualified by,
or that it is otherwise subject to, any treatise, written
policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of
the ABA Section of Business Law (1991).
Exhibit A-4
FORM OF OPINION OF COMPANY'S SPECIAL
CAYMAN ISLANDS COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)
(i) CVTA has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has corporate power
and authority to own, lease and operate its properties and
to conduct its business as described in the Offering
Memorandum and is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to
qualify or to be in good standing could not reasonably be
expected to result in a Material Adverse Effect; all of the
issued and outstanding capital stock of the CVTA has been
duly authorized and validly issued, is fully paid and
non-assessable and, to the best of our knowledge and
information, is owned by the Company, directly or through
subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(ii) To the best of our knowledge, CVTA is not in, nor
with the giving of notice or lapse of time would be, in
violation of or in default under its certificate of
incorporation or bylaws.
In rendering such opinion, such counsel may rely as to
matters of fact (but not as to legal conclusions), to the
extent they deem proper, on certificates of responsible
officers of the Company and public officials. Such opinion
shall not state that it is to be governed or qualified by,
or that it is otherwise subject to, any treatise, written
policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of
the ABA Section of Business Law (1991).
Exhibit B
March 1, 2000
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated
X.X. Xxxxxx Securities, Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx Inc.
XX Xxxxx Securities Corporation
as Representative(s) of the several Initial Purchasers
c/x Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
The undersigned, a stockholder and/or officer and/or
director of CV Therapeutics, Inc., a Delaware corporation
(the "Company"), understands that Xxxxxxx Xxxxx & Co.,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx"), X.X. Xxxxxx Securities, Inc., FleetBoston Xxxxxxxxx
Xxxxxxxx Inc. and XX Xxxxx Securities Corporation propose to
enter into a Purchase Agreement (the "Purchase Agreement")
with the Company providing for the offering of the Company's
4_% Convertible Subordinate Notes due 2007 which are
convertible at the option of the holder at any time on or
prior to maturity into shares of the Company's Common Stock,
par value $.001 per share (the "Common Stock"). In
recognition of the benefit that such an offering will confer
upon the undersigned as a stockholder and/or officer and/or
director of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned agrees that, during a
period of 90 days from the date of the Purchase Agreement,
the undersigned will not, without the prior written consent
of Xxxxxxx Xxxxx, directly or indirectly, (i) offer, pledge,
sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any
option, right or warrant for the sale of, or otherwise
dispose of or transfer any shares of the Company's Common
Stock or any securities convertible into or exchangeable or
exercisable for or repayable with Common Stock, whether now
owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires
the power of disposition, or file any registration statement
under the Securities Act of 1933, as amended, with respect
to any of the foregoing or (ii) enter into any swap
or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or
transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise. The undersigned
understands that Xxxxxxx Xxxxx has agreed, subject to
approval by the Company's Chief Executive Officer, to an
exception to the foregoing agreements to permit the sale of
up to 100,000 shares of Common Stock in the aggregate by the
undersigned and the other persons executing letter
agreements identical to this letter agreement.
Very truly yours,
Signature:
_________________________
Print Name:
________________________
